Employment rate returns to 75.7%, ONS reveals
Estimates from the Labour Force Survey show that, between May to July 2018 and August to October 2018, the number of people in work and the number of unemployed people both increased but the number of people aged from 16 to 64 years not working and not seeking nor available to work (economically inactive) decreased.
There were an estimated 32.48m people in work, 79,000 more than for May to July 2018 and 396,000 more than for a year earlier.
The employment rate (the proportion of people aged from 16 to 64 years who were in work) was estimated at 75.7%, higher than for a year earlier (75.1%) and the joint-highest estimate since comparable estimates began in 1971.
There were an estimated 1.38m unemployed people (people not in work but seeking and available to work), 20,000 more than for May to July 2018 but 49,000 fewer than for a year earlier.
The unemployment rate (the number of unemployed people as a proportion of all employed and unemployed people) was estimated at 4.1%, virtually unchanged compared with May to July 2018 but lower than the estimate for a year earlier (4.3%).
There were an estimated 8.66m people aged from 16 to 64 years who were economically inactive (not working and not seeking nor available to work), 95,000 fewer than for May to July 2018 and 195,000 fewer than for a year earlier.
The economic inactivity rate (the proportion of people aged from 16 to 64 years who were economically inactive) was estimated at 21.0%, lower than for a year earlier (21.5%) and the joint-lowest estimate since comparable estimates began in 1971.
Latest estimates show that average weekly earnings for employees in Great Britain in nominal terms (that is, not adjusted for price inflation) increased by 3.3%, both excluding and including bonuses, compared with a year earlier.
Latest estimates show that average weekly earnings for employees in Great Britain in real terms (that is, adjusted for price inflation) increased by 1.0% excluding bonuses, and by 1.1% including bonuses, compared with a year earlier.
Recruitment & Employment Confederation (REC) director of policy, Tom Hadley, stated, “Recruiters continue to work hard with employers to fill jobs and aid future growth – but with near-record numbers of vacancies in the UK labour market (848,000 for September to November 2018), and candidate availability tight, the challenge of finding the right staff is set to intensify.
“These latest figures also don’t reflect the political uncertainties in the last week. Even before the latest turbulence, REC data showed employer confidence in the economy declining month on month – down from net: 6 in July 2018 to net: -11 in November 2018.
“Businesses need clarity regarding Brexit and a pragmatic approach to future immigration policy to deal with labour shortages. Employers are looking for reassurances from Government over our future relationship with Europe, but instead they are facing more uncertainty by the day.”
Pawel Adrjan, UK economist at Indeed, commented, “In ordinary times, ministers would trumpet such record employment figures and rising wages as an achievement.
“Not today. The febrile atmosphere in Westminster means they will pass largely unnoticed. In any case, while wages are inching up, the rising cost of living means real progress is glacial. The average Briton’s weekly paypacket is now just £4.50 bigger than it was last Christmas – barely the cost of a mulled wine.
“Nevertheless this is the best jobs report we’ve seen in a while. More people are being tempted back into the workforce, and this will come as an early Christmas present for companies struggling to recruit. UK employers still have 848,000 vacancies, and the ratio of unemployed people per vacancy remains at a record low.
“As a result many employers have had to increase wages in order to poach recruits from elsewhere, or broaden their search to tap into underused talent pools. While January traditionally provides a boost in jobseeking activity, the tightness of the labour market means recruiters will have to fight harder - and look further - for every new hire.”
Ian Brinkley, acting chief economist at the CIPD, commented, “While the labour market has seen some growth in employment, and a very slight rise in unemployment, it is getting steadily tighter. This implies that labour and skill shortages will increase and recruitment and retention may become more challenging. However, these pressures stand to significantly increase if the current uncertainty over Brexit deters more migrants from coming to the UK and net migration from the EU continues to fall.
“Wage growth has edged up slightly driven by the finance and business service sector. Real earnings have also strengthened. Historically, real wage growth and productivity growth have gone hand in hand, but it remains to be seen if rising real wages will also be reflected in better productivity figures in the months ahead, given the current Brexit crisis.
“It’s vital that employers look at how they can invest in skills and adopt the right people management practices to boost productivity in their organisation and the UK overall.”
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